Page 8 - CSA Celebrity Speakers | CSA Speaker Bulletin January 2016

MANAGEMENT
The
Corporate
Near Death
Experience:
Seize the
Opportunity!
Don Strickland, former Senior
Executive at Apple, CEO of
PictureWorks, CEO of IPIX and
Adjunct Professor of Innovation
and Entrepreneurship at Imperial
College London, spoke with
Dagmar O’Toole, Editor of CSA
Speaker Bulletin about triumphing
over the corporate near death
experience.
Q What, exactly, is a “Corporate
Near Death Experience?”
A A company experiences
near death when it has so
underperformed for an extended
period of time that everyone in the
company doubts whether it can
survive. It is a period of high stress, giving everyone the passion to make
and bankruptcy is a real possibility.
Q Does it happen to all
companies?
A It is something that all
companies experience sooner
or later in their business cycle. If
no action is taken, the near death
experience becomes the death of the
company. This means bankruptcy or
a fire sale. That is what happened to
Kodak, for example. The majority of
companies that undergo a near death
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06
experience end up cutting costs only
to save a marginal business. Only a
very few, such as Apple, seize the
opportunity to reinvent themselves and
come back as a really great company.
Q You had direct experience with
this at Apple. You joined Apple
as their Vice President of Publishing
when they were very close to
bankruptcy. A few years later they
had reinvented themselves and
now are the world’s most valuable
company. What was it like?
A It was crazy! I had been at
Apple for two weeks when all
of the VPs were told to lay off 20%
of their employees, and to have it
done within six weeks. That was
my introduction to what it takes to
reinvent your company. I learned
that the pathway to reinvention is
unpredictable. It is all about picking a
new direction, aligning up everything in
the company towards it, and the CEO
it happen. It won’t happen overnight
and don’t expect to get it right the first they satisfy three questions: Do they
time. Steve Jobs came back to Apple
in 1997, but the stock price didn’t take
off until 2004.
Q What is the most important
thing for a CEO when leading
a company through a near death
experience?
A The CEO needs to create a
sense of urgency to tackle the
problems early rather than wait until it
is too late. This requires changing the
risk profile of the company. Companies
that have enjoyed years of success
naturally become risk averse. When
the early signals appear that the
business is in trouble, the risk averse
reaction is to “try harder.” That doesn’t
work in the long term. What the CEO
needs to do is change the attitude
toward risk so the company is more
risk accepting. Reinventing a company,
after all, is a risky business.
Q Reinventing a company
involves a lot of internal
disruption. How does the CEO hold
the company together?
A Culture. Culture trumps
everything in a company. At
Apple, it was the culture that enabled
the company to survive the difficult
years and come back a winner. Building
a great culture is not rocket science,
but it is hard work. I always start with
the corporate values. Are they generic
and obvious such as “we will treat
each other with respect” or “we are
committed to delivering superior value
to our customers”? Or, as in the case
of Apple, are they really meaningful?
“We believe in the simple, not the
complex” and “We are on the face of
the earth to create great products.”
My test for corporate values is that
make employees want to work for the
company? Do they make customers
want to buy from the company? Do
they sound like they were written by
the CEO? If you answer “yes” to all
three questions your company has a
great set of values. n